Global firm TPG Capital will make its first acquisition in the Chinese solar power arena by investing up to HK$1.2 billion (€105.4million; $150 million) in Hong Kong-listed Comtec Solar Systems.
The transaction will take the form of a convertible bond purchase in which TPG will buy HK$780 million-worth of bonds issued by the company due in 2016, according to a statement. Additionally, TPG will also receive 95 million warrants which will have a maturity of five years. If the warrants are exercised in full, TPG will invest an additional HK$390 million and receive 95 million new ordinary shares in Comtec.
In total, if the bonds are fully converted and the warrants fully exercised, TPG stands to hold 21 percent of the issued share capital of Comtec.
Comtec designs and makes monocrystalline solar ingots and wafers used in the production of solar cells and modules. The statement noted that the Shanghai-based company has ambitions to expand its customer base internationally.
“Comtec is our first China-based solar investment, and we are confident in Comtec’s ability to expand successfully. We believe the strengths of both parties will contribute to an effective partnership,” said Stephen Peel, managing partner of TPG Asia in the statement.
This is not the first PIPE investment TPG has made in Hong Kong, nor is it the first Asian cleantech company it has backed. In October last year the US firm acquired an 18.45 percent stake in the Hong Kong-listed alternative energy developer Hong Kong Energy (HKE) for HK$390 million. HKE is a provider of wind energy solutions.